Speaking in the House of Commons today (22 November), Hunt said he had “listened closely to the persuasive arguments on alcohol duties” and decided against increasing duty in line with inflation from April.
“As well as confirming our Brexit Pubs Guarantee, which means the duty on a pint is always lower than in the shops, I have decided to freeze all alcohol duty until 1 August next year,” Hunt said. “That means no increase in duty on beer, cider, wine or spirits.”
Beer, wine and spirits makers had been bracing themselves for another tax hike in April, after a three-year freeze on duty came to an end in August of this year.
Duties rose by 10.1% in line with inflation, alongside the introduction of a new duty system that sees alcoholic drinks taxed according to their strength.
The Wine & Spirit Trade Association described the freeze as “a huge relief” to a sector that had “taken a battering”.
“We are extremely relieved that the government – and exchequer secretary, Gareth Davies in particular – has listened to our pleas not to hit wine and spirit businesses and consumers with another painful duty increase,” CEO Miles Beale said.
Describing the threat of a second duty rise as “disastrous”, Beale implored the Chancellor to “lock in the freeze until at least the end of this Parliament”. This, he said, would “keep people in jobs and mean consumers will still be able to enjoy a drink at a price they can afford”.
Kathy Caton, managing director of SME distiller Brighton Gin, said the move was “a great relief for us and our fellow craft distillers”.
“The August duty hike has had a very clear and damaging effect on sales,” she said. “There have already been some very high-profile closures of businesses in our sector and a second duty rise could have seen more distilleries go bust.”
Maintaining the government’s Brexit Pubs Guarantee, meanwhile, means duty paid on beer and cider sold for consumption in the on-premise remains up to 11p per pint cheaper than those sold in supermarkets.